The FTSE 100 closed down 24.13 points at 7013.88 and the pound was at $1.28 against the dollar.

Sterling steadied after enduring its biggest one-day decline for more than two years amid Thursday's Brexit deal chaos.

But stocks on the London market finished the day in the red as investors were braced for more turbulence amid speculation Prime Minister Theresa May may face a confidence vote over her leadership.

Financial and banking stocks and housebuilders remained under pressure as firms exposed to the UK economy continued to be hit on fears over the impact of a no-deal on growth.

Royal Bank of Scotland fell 3 per cent, while peers Lloyds Banking Group and Barclays dropped 1.7 per cent and 0.9 per cent respectively

Britain's biggest banks were summoned for a call with City regulators on Thursday over market moves caused by the Brexit deal turmoil.

It is understood major UK banks were asked for their feedback on the market reaction, with the Financial Conduct Authority saying it was having 'regular contact' with firms and would 'continue to engage with them'.

Housebuilders were also among the worst affected stocks on Thursday and continued to suffer falls. Persimmon and Barratt Developments both fell by more than 2 per cent.

Imperial brands shares were 35p higher at 2,638.5p after it said further research is needed around US plans for an outright ban on menthol cigarettes.

Tobacco stocks were routed earlier in the week amid reports of the plans by the US Food & drug Administration for a ban.

Kier Group's share price rose 31p to 856p. as it said it would book £10 million of costs in its half-year related to the group's turnaround programme, but assured this is set to reverse over the full year.

The biggest risers on the FTSE 100 were Micro Focus up 53p to 1,463.5p, Paddy Power up 245p to 7,205p, Rio Tinto up 109.5p to 3,910p, and Smurfit Kappa up 48p to 2,302p.

The biggest fallers on the FTSE 100 were Melrose down 11.05p to 171.45p, RBS down 7.3p to 216.9p, Royal Mail down 9.4p to 316p and CRH down 56p to 2,140p.

17:03

FTSE 100 closes down 24.13 points at 7013.88

16:45

City pundits on today's session

Chris Beauchamp, chief market analyst at IG, said: 'The Brexit drama refuses to go away as a no confidence vote in the PM becomes more likely.

'The US and China remain bogged down in arguments over tariffs, and as so often before moves to secure further negotiations have ended in failure.

'Equities in general continue to trade in a sideways fashion, with attempts to move higher frustrated by a collection of worries.

'While we have seen the session turn more optimistic, there is still no clear return to the easy move higher seen earlier in the year.

'Oil prices however have managed to put in another good day, but for now this still seems like one of the short-lived rebounds that we have become used to over the last month.

'The working week finishes with Theresa May still in power, a prospect that looked doubtful just 36 hours ago.

'However, the volatility is not over yet for GBP [sterling] traders, who must now gird themselves for the real possibility of a no-confidence vote that might upend the Brexit process just as we started to get some clarity.'

David Madden, market analyst at CMC Markets, said: 'Stock markets are in the red as investors are still worried about the political sentiment in the UK and Italy.

'Massive political uncertainty still hangs over Theresa May. Political commentators are questioning Mrs May’s ability to sell the withdrawal agreement to her own party, and a failure to do so could lead to a no deal scenario – which has spooked investors.

'The political fight between Italy and the EU is taking a backseat to Brexit right now, but make no mistake, another round of the eurozone debt crisis could be in the offing.

'The major equity markets in the US are mixed as traders are a little uncertain which way to look. The trade stand-off with China continues, and even though Beijing have outlined some possible concessions, the two sides are still at odds with each other.'

14:52

TomCo Energy sees its shares suspended today

Oiler TomCo Energy was plunged into crisis today after its shares were suspended and its broker quit citing potential reputational damage.

SVS Securities terminated its broker appointment with immediate effect and ended an agreement to act as agent for the company's £532,350 share placing, saying its reputation was 'likely to be prejudiced' by continuing as the company's placing agent.

The index is generally considered as a more accurate barometer for the state of the UK's economy than the FTSE 100 index.

14:43

Pound dips slightly against the euro once again

The pound is down 0.03 per cent to €1.1277.

14:23

Melrose Industries, RBS and AstraZeneca shares all down over 3%

14:18

Why is the FTSE 100 in the red again this afternoon?

Connor Campbell, an analyst at SpraedEx, told This is Money: 'With the pound regaining some confidence – the FTSE’s fealty to sterling didn’t last long – and the housing and banking sectors resuming yesterday’s Brexit-inspired decline, the UK did a complete 180 on Friday, sinking by 50 points having been up by that much at the start of the session.'

14:06

Pensioners who owe Bank of Scotland and Barclays debts fight back

Around 130 borrowers who took out shared appreciation mortgages in the late 1990s are set to take Bank of Scotland and Barclays to court early next year.

It follows more than two years of work by law firm Teacher Stern to put together a case that they claim is watertight against the banks and arrange a finance deal that means borrowers - most of whom are well into retirement - don't lose out financially if the claim fails.

The firm is now issuing a final call to borrowers or relatives of borrowers who took out the loans from either bank 20 years ago, saying there is still time to join the action.

Steve Baker confirms his list does indeed suggest 48 letter threshold has been reached with maybe a dozen more - but he says impossible to know for sure because colleagues aren’t sometimes coy about what they have actually done

According to Bloomberg, Peugeot-maker PSA Group is reviewing responses to a potential market decline after the UK leaves the European Union, including the feasibility of permanently shutting down one of its two Vauxhall sites.

Bloomberg's source has remained anonymous.

11:35

Number of no confidence letters reaches 21: 48 needed for vote

11:32

Markets steadying after yesterday's Brexit fallout

The pound has steadied after enduring its biggest one-day decline for more than two years amid yesterday's Brexit deal chaos.

Stocks on the London market also regained their poise, but investors were braced for more turbulence amid speculation Prime Minister Theresa May may face a confidence vote over her leadership.

Sterling edged 0.2 per cent higher to just below $1.28, having tumbled on Thursday after a raft of key ministerial resignations – including Brexit Secretary Dominic Raab – sparked the steepest sell-off since the October flash crash in 2016.

Edinburgh is the city with the fastest selling property, while London languishes near the bottom of the pile, a new report shows.

Homes in the Scottish capital take an average 39 days to sell while at the other end of the scale in Blackpool, sellers had to wait on average 131 days, according to the latest Post Office Money and Centre for Economics and Business Research report.

London, however, was not far behind the seaside resort, with properties taking around 126 days to sell – much longer than the UK average of 102 days.

'Stocks and sterling stabilise as political tensions cool', Madden says

David Madden, an analyst at CMC Markets UK, said: 'Stocks in Europe have bounced back today, but some of the major indices have given up some of the early gains.

'Theresa May had a disastrous day yesterday, and investors are still on edge over the political situation in the UK. Politics is also in focus in Italy as Rome and Brussels are still locked in a stand-off over the budget.

'For the time being, Brexit will grab more attention in the media, but the Italian problem could spark another round of the eurozone debt crisis.'

10:05

Rolls-Royce boss says a 'practical plan' is now needed for Brexit

Rolls-Royce chief executive Warren East has called for politicians on all sides of the Brexit debate to thrash out a deal for the good of UK business.

'The time since the referendum seems to have gone remarkably quickly and we're essentially [still] having a discussion we could have had the morning after the referendum,' Mr East said on BBC Radio.

10:01

Construction group Kier booking £10m worth of costs amid turnaround

Kier is to book £10million worth of costs in its half-year related to the group's turnaround programme, but has assured this is set to reverse over the full year.

The construction company said its 'Future Proofing Kier' programme to streamline the business and improve cash generation is making good progress.

Implementing the programme in the first half of its financial year is expected to cost £10million as initial expenses exceed realised savings.

Shares are up 4.61 per cent to 863.00p.

09:45

BREAKING NEWS: Michael Gove is not resigning from the Cabinet

09:42

Are we edging closer to a vote of no confidence?

Sky sources: All government whips have been told to cancel any engagements today and return to London as a source close to the whip's office says a no confidence vote in the Prime Minister is now "likely"

When pensioners Joan and Alex Babb discovered their annual council tax bill was the same as their neighbour's they were surprised.

Their Gloucestershire home is a one-bedroom bungalow, while neighbours on the other side of the road live in three-bedroom semi-detached houses with garages.

All are charged £1,232, but when Joan, 73, challenged her Band B bill she was met with a response that highlights the problems of many homeowners around the country who feel they are paying the wrong amount.

There has been a sharp rise in the number of people receiving hoax emails that claim to be from the TV Licensing department, a crime body has warned.

More than 2,500 reports of phony emails were sent to Action Fraud in September and October alone from those who have found one in their inbox.

The scam emails aim to get unsuspecting people to hand over personal and bank details to fraudsters who pretend to be from the TV Licensing department, according to the UK's national reporting centre for fraud and cybercrime.

Virgin Media and EE have been fined a combined £13.3 million by regulator Ofcom for overcharging nearly 500,000 phone and broadband customers who wanted to leave their contracts early.

Ofcom said both companies broke consumer protection rules by failing to make clear the charges customers would have to pay if they ended their contract early and levying 'excessive' fees to leave.

The watchdog's investigation into early-exit charges at the groups found about 400,000 EE customers who ended their contracts early were over-billed, which saw customers end up overpaying up to £4.3million.

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